Here's our summary of key economic events overnight that affect New Zealand, with news financial markets may be moving on from the US-Iran deal, but commodity markets are noting that Iran will now have the opportunity to charge for transit ('fees' but no 'tolls') after a key US concession. The MOU is signed.
In the US, jobless claims dipped slightly last week to 219,500 but at about the rate expected as what seasonal factors would have indicated. There are now just under 1.7 mln people on these benefits, marginally less than a year ago.
The Philly Fed factory survey recovered in June after the poor report for May, but only to a level below its 2026 average. These firms said prices paid moved up while the prices they got for their goods dipped.
Meanwhile the US Conference Board's leading index rose marginally in May, and this metric suggests it may be coming to the end of its long term down trend that started in 2022.
In Canada, producer prices were up +13.6% in May from a year earlier with +1.2% of that coming in the latest month. Of course, most of this was energy related. In fact raw materials costs were up +33% from a year ago within the overall result.
There was a lot of central bank action overnight, all timed to follow the US Fed. Taiwan held its policy rate unchanged at 2.0% as expected. Indonesia hike again, up +25 bps to 5.75% quickly following last week's out-of-cycle emergency hike to support their currency.
The central Bank of England held unchanged at 2.75% (with two of their nine members wanting a hike). The Swiss central bank held at 0%. The Norwegian central bank held at 4.25%. And the Swedish central bank held at 1.75% a day ago. All these came after last week's +25 bps rise by the ECB.
Global container freight rates surged another +12% last week to be +21% higher than this time last year. There were increases in all major trades but the China-EU trade got the biggest hit. Meanwhile, bulk cargo rates fell -8% over the past week to be +36% higher than year ago levels.
The UST 10yr yield is now just on 4.44%, down -2 bps from this time yesterday. The key 2-10 yield curve is now at +27 bps (down -9 bps in a notable flattening). Their 1-5 curve is now at +23 bps (-7 bps) and the 3 mth-10yr curve is at +78 bps (unchanged). The China 10 year bond rate is unchanged at 1.73%. The Japanese 10 year bond yield is up +1 bp at 2.61%. The Australian 10 year bond yield starts today at 4.79%, up +2 bps from yesterday. And the NZ Government 10 year bond rate is up +6 bps at 4.47%.
Wall Street bounced back today with the S&P500 up +0.9% and the Nasdaq is up +1.5%. Overnight, European markets closed up +0.4%, except London which fell -1.0%. Tokyo ended its Thursday session up +1.6% to a new record high. Hong Kong however fell -1.6% and Shanghai fell -0.4%. Singapore rose +0.7%. The ASX200 ended its Thursday session down -0.6%. And the NZX50 dipped another -0.2%.
The price of gold has retreated another -US$44 from yesterday to US$4229/oz. Silver is down another -US$2 at US$66/oz.
Oil prices are down -US$1 from yesterday at just under US$75.50/bbl in the US, while the international Brent price is now just over US$78.50/bbl and down -50 USc. Hormuz transits are picking up with 13 crude or product tankers exiting over the past 24 hours and 13 entering for new loads. (Normal is 60 in each direction.)
The Kiwi dollar is down -60 bps from this time yesterday at just on 57.6 USc. Against the Aussie we are down -30 bps at 82.0 AUc. Against the euro we are unchanged at just under 50.2 euro cents. That all means our TWI-5 starts today at just over 61.3 which is down -50 bps from yesterday.
The bitcoin price starts today at US$62,623 and down -5.1% from this time yesterday. Volatility over the past 24 hours has been high at just under +/- 3.0%.
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41 Comments
Reading through the latest, Iran 1 USA nil, reporting outcomes far worse than intentions, somehow the old school scripture lessons came forward. They should rename the eighteenth book in the Old Testament from The Book of Job to the Book of Trump. Regionally it would rather fit wouldn’t it.
Trump won because no one's talking about Epstein any more. He probably took some profit from causing values to change on a daily basis too. The fact that America lost would be of no concern to him.
It's amusing how people just look at the surface level of things. Simple souls, poor sweet summer children. In many years to come, historians will look back at these events and marvel at the brilliance of President Trump.
The Orange man created the Trump coin to profit off the presidency and his fans. There is only one person he cares about.
What do you think historians will marvel about? What did the US get out of the war? The only smart thing Trump did was end it.
As Premier Zhou Enlai said, "It's too early to tell".
Global energy flows and resilience will greatly improve. The influence of Israel on the thinking of the US and Europe, essentially the West, will radically change. Myths have been shattered which is not necessarily a bad thing as myths are dangerous. Weapons stockpiles will be refreshed, developed and improved. The Arab Gulf States along with Ukraine and the West will work on developing their own drone swarms and drone defences. This will greatly assist Ukraine. Combined, the Arab Gulf States have immensely more wealth to spend on military hardware than Iran does. Any reliance on popular uprisings will forever be put to rest.
Am I understanding this right - your positive spin is that now we know that Iran's regime is well entrenched, but on the plus side the whole region will have to invest massively in military hardware to overpower them?
Truly a masterstroke my peacemaker Trump. We know from the actions of his administrations that any benefits to Ukraine will be purely coincidentally and possibly actively undermined.
The only way this will happen is if the Trump dynasty take over the American Empire and historians are too afraid to say otherwise.
Yes. Trump has the spine to stop the unthinkable - a nuclear armed Iran. Its bad enough Nth Korea has nuclear weapons. Russia too is a nuclear threat to the west. The European free-loading countries are now beefing up their defenses at last. On economics, Trump has wisely upended free trade (you know, where countries like nz have to compete against countries with child slave Labour, environmental apocalypse, human rights offenses). Countries that have taken advantage of the US. Every country wants USD. Fair trade is now the new paradigm and rightly so.
Were the European countries really free loading? Study your history. They were in a position developed by the US long before Trump, but post WW2. They were all doing what the US wanted them to do, being dependent on the US in some form. Trump shit canned that.
Obama had the spine too, but he did it in a more sensible way.
At best Trump will end up with an agreement on nuclear which won't be any better than what Obama had. At worst the Iranians will tell him to piss off (which is probably why this deal took so long).
"Trump has wisely upended free trade" - I'm not sure he's achieved much. Most of the countries he wanted to shaft are actually trading quite well.
Which historians? Historians that speak in single syllable sentences?
Most historians. But the point I am making is that we really have to wait and see. Those with TDS have consistently ended up with egg on their faces.
Zachary Smith was a bit of a shyster, wasn't he? Birds of a feather and all......?
TDS is a thing, except it's manifestation isn't among Trump opponents.
MAGA are thick as pig doody!
Laura Loomer discovering she's an idiot.
But he will lose in the mid-terms.
No Epstein is still being discussed. There's a faction of the media who will not let it rest. Too many unanswered questions and more than a few ready to give the victims a voice. At best Trump has only delayed the accounting.
Agree, but its a lot quieter than it was before the war.
Haberman's new book apparently contains interesting titbits https://edition.cnn.com/2026/06/18/politics/new-book-reveals-how-trump-…
Trump was betting that with a show of force he would get domestic led regime change in Iran and the US would then control the country by a puppet government.
Didn't happen. Then he floundered around like the school bully when someone finally pushes back. Lots of mean words and vain attempts to make out that he's still in control.
Apart from that there's a lot of variables like Israel and he's really just fighting those fires one by one.
I imagine Bibi has some attempted regime change coming his own way soon.
The NYT did a great article on the lead up to the decision to start the war, effectively Bibi promised Trump that Iran leadership would collapse and it would a Venezuela type situation. Trump brought it hook line and sinker despite his own intelligence agencies telling him it wouldn't work...
Trumps ability to profit off the situation through insider/volatility trading probably also pushed him to go ahead with it
The King Trump 11 version would have him resting on the 14th day.
And the book of Jones would be pointing out that having cast their nets on all sides, they needed to reduce mesh size - drawing on the eye-of-a-needle precedent.
And the Book of Revelations gets opened a certain distance out from an election.
Meanwhile Armageddon closer...
FG. Iran certainly comparable to Job in terms of the appalling disasters visited upon it but no indication so far of its governments end likely being considerably better than its prior position, as per the story of Job. Its' military capacity and ability to expand Iranian dominance across the ME has been massively degraded, its economy is in tatters and its nuclear ambitions thwarted, for now anyway. Its people have suffered immensely but at the same time have observed IRGC's vulnerability. The game has some time to run yet, I suggest it's too early to be declaring the score.
It is a stretch for DC to declare Iran "stronger" when they just discovered their multi billion air defence doesn't work as advertised and managed to lose their air force, navy, 10's of billions dollars of useless anti aircraft gear, their nuclear facilities, leadership, proxies hammered etc. They are about as strong as the Black Knight. Talk a good game but can't do anything apart from push up the price of oil for Trump - the world's biggest oil and gas exporter.
4 weeks
The next 60 days will be intriguing. I reckon we're not out of the woods yet re Israel/US/Iran
Long way from it. This can of worms is far from empty. More meat for PDK's gospel.
When you have the US showing clear desperation to exit the Iran miss-adventure ie “peace” and then at the same time Trump bleating that should Iran not do what they are told they will be bombed into oblivion, it doesn’t fill me with hope of long lasting peace.
This "desperation" is mostly media hype.
Yeah probably. Society will function brilliantly with retricted oil supply and drained strategic reserves.
Yep, it certainly will, because it will refill those reserves and make supply more resilient.
Israel are even bigger losers than the US. They either keep fighting and potentially lose all support from the US, or not and become targets (especially when the Iranians have nuclear weapons). Who knows which way they will go.
This I suggest is what almost everyone is missing; Iran doesn't need nuclear weapons, never did. Likely they don't want them because they would draw too much attention due to the nature of their regime. But they can still enrich uranium and supply that to other players. The entire scenario is very worrying as nuke materials don't need to be used in a fission or fusion bomb to be lethal. The level of innovation being applied to drones could easily be applied to the use of enriched nuke materials and the outcomes in many ways much worse.
Murray. Among multiple takeouts from this war is that whatever Iran attempts will be quickly known by the increasingly penetrative intelligence of the US and Israel, including restarting enrichment. Much of the commentariat attributes US strategic positioning on the ME to the bizarre inhabitant of the White House when the reality is he is effectively just the stop go guy. US electoral cycles will deliver alternating positions of attempting negotiations with the govt of Iran it considers a terrorist organisation through to more hawkish approaches but the establishment position will continue to be that enrichment cannot occur. The world will be passing this way again.
Maybe, maybe not. Unlikely we'll know until it's too late. Complacency is insidious.
Not sure we won't know, if that's what you mean. The intel Israel and the US acquired on Irans nuclear program has been startlingly accurate. It's not being complacent to believe it's possible to convince the IRGC to stop enrichment through negotiation, just delusional. As history has demonstrated. Maybe this time will be different but I don't hold out much hope.
It's not being complacent to believe it's possible to convince the IRGC to stop enrichment through negotiation, just delusional. You've misplaced the 'complacency' bit. I agree it's delusional. Complacency is when you think you've got it all covered and nothing will happen.
The nuclear issue with Iran, if any, was sorted years ago. But Trump screwed that in the first term.
As for US/Israeli intelligence and threats. Remember the fiasco of Irag and Weapons of mass destruction.
The most bizarre of that one was them parading they had found a chemical weapons factory. Until the New Zealand engineer spoke up saying he knew it was a dairy factory. And he knew that because he was the guy who built it.
KH. 'Sorted' as in Iran continuing to enrich to a very high level while continuing 'negotiations' and insisting it was for peaceful purposes only, none of which requires more than a fraction of that level?. Sure. The Iraq delusion was even worse than you describe, it didn't need a NZ dairy engineer to identify that Bush and Blairs claims of WMD were wrong, they both knew with certainty before they launched the invasion that their 'intel' was manufactured BS yet carried on. This time even the Iranians are not arguing they don't don't possess close to weapons grade fissile material.
Plenty of people believed the WMD lies. Same as folk still believe the recent Nukes claims.
But the nukes thing was well controlled and supervised until Trump trashed that agreement. Yes, Iran then got back into enrichment (source dubious).
But the Iranians are not dumb. No advantage in going nuclear. And they are not mad like the propaganda will have it.
Mind you the Israelis are capable of hurling nukes west instead of east if their situation crumbles.
TRUMP'S MASSIVE OWN GOAL
The repercussions from Trump's illegal war on Iran are a long way from over, and for multiple reasons, including the situation in Lebanon.
https://sovereignista.com/2026/06/17/us-releases-mou-with-iran/comment-…
...quoted...
"The Iranian Foreign Ministry stated:
The memorandum of understanding consists of 14 points on a page and a half, with the first two points dedicated to the general framework for negotiation.
Lebanon is mentioned three times in the MoU. Ending the war on all fronts, including Lebanon, is a precondition for starting and continuing negotiations. The continued “israeli” occupation of southern Lebanon violates the MoU, and we will take the necessary measures.
Both sides pledged to negotiate a final agreement within 60 days, beginning Friday.
The US must lift the naval blockade and stop harassing our ships within 30 days, which it has begun. We will restore normal traffic in the Strait of Hormuz and remove some obstacles there, with Iran and Oman cooperating on managing the strait and servicing ships, consulting regional states as needed.
The US pledged to remove obstacles tied to our frozen assets, with some details discussed.
During the 60 days we will negotiate sanctions, enriched nuclear materials, and uranium enrichment. The US pledged to lift all sanctions, including UN Security Council ones, on a timetable to be discussed."
MAX BLUMENTHAL gives a courageous call on the panic that Israel finds itself in.
Only one country on Earth was in full support of their ethnic-cleansing/genocide and their Greater Israel Project, and they have now lost that support too, as Trump tries desperately to salvage his party's position for the midterms this year.
Too late for Trump anyway - he will lose the Lower House, and once the effects of his war on Iran fully kick in on the global economy, he could possibly lose the Senate as well, even though it is only 1/3rd of the seats that are being contested.
Republicans currently hold a 53-47 majority (including two independents who caucus with Democrats). To flip the chamber, Democrats need to achieve a net gain of exactly four seats.
The Democrats need to pull off several outright flips in reliably red or competitive purple states* like Michigan, Georgia, North Carolina, and Maine.
* ("Purple states" refer to highly competitive US states where neither the Republican (red) party nor the Democratic (blue) party has a guaranteed majority)
As one commenter put it... " Max is part of the next generation that will help rebuild America honestly after the maniacs finish asset stripping us and toss us to the curb."
There are multiple reports that Iran has already cancelled the signing of the MOU at a secure location on the eastern side of Lake Lucerne in Switzerland, and that they will not be attending any such meeting until Israel ceases all hostilities in Lebanon.
'fees' but no 'tolls'
"Fees" sounds more expensive.
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